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Friday, October 22, 2021

‘Make in India’ meets ‘India strategy’

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By Vish Viswanathan

Vast potential exists for investors in India and Australia through inclusive initiatives

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Exactly a year ago, Indian Prime Minister Narendra Modi marked his election win by launching two major initiatives –‘Swachh Bharat’ (Clean India), a social cause dedicated the cause of cleaning up the country and ‘Make in India’, a business policy initiative promoting products and services developed locally. While the country is making some progress towards cleanliness, the ‘Make in India’ initiative has taken off in a positive way, making a global impact since its launch on September 25, 2014, exactly after a day after the Mangalyaan robotic probe to Mars was launched successfully, made in India and at a reasonable cost.
The main goal of ‘Make in India’ is to increase contribution of the manufacturing sector in India to at least 25% of its Gross Domestic Product (GDP) from the current level of only 15%.
“Whenever I met (business) people for the last few years they would tell me – we want to shift out… It pained me that people of our nation are forced to leave,” said Mr Modi while launching the ‘Make in India’ campaign in 2014. He added, “India must increase manufacturing and at the same time, ensure that the benefits reach the youth of our nation.”

make in india
“The ‘Make in India’ initiative has been specifically designed to facilitate investment, foster innovation, protect intellectual property, and build best-in-class manufacturing infrastructure in India,” states Sunjay Sudhir, Consul General of India in Sydney, who spoke exclusively to The Indian Telegraph about this initiative in its Australian context.
25 sectors including automobiles, chemicals, IT, pharmaceuticals, textiles, ports, aviation, tourism and hospitality, railways, automobile components, renewable energy, bio technology have been identified by the Government of India in promoting the campaign. 100% Foreign Direct Investment (FDI) is allowed in many of the sectors, encouraging many countries to consider active participation in the Indian market.
Since its launch, PM Modi has been personally leading the promotion of the initiative in his global visits, resulting in successful commitments to many multi million or billion projects such as French-designed Rafault aircraft to be made in India, indigenised M777 light weight Howtizer, Kamov choppers for the Indian Defence Force, besides lucrative deals with Tata, BMW and Honda.
So what about Australia? India is an increasingly important business destination for Australian companies, in merchandise trade and in services, with internal and external investments playing a key role in this equation. There is considerable scope to expand India’s economic relations with Australia, underpinned by trade and investment linkages.
There seems to be emerging interest in ‘Make in India’, with many Australian businesses, as well as State and Federal governments looking to participate in the initiative.
Mr Sudhir offered his exclusive views on ‘Make in India’ and its relevance to Australia’s government and its businesses. Here are excerpts of his discussion; the complete interview is available on www.theindiantelegraph.com.au
Vish Viswanathan: Of the 25 sectors identified by the Government of India to promote its ‘Make in India’ initiative, which are most relevant to Australian businesses?
Sunjay Sudhir: India Australia cooperation covers a wide spectrum of sectors and we have several MOUs including science and technology, defence, nuclear, among others. Some of the important sectors with significant potential for Australian investment are bio-tech, food processing, construction, ports & roads (infrastructure), mining, oil & gas, renewable energy, information technology, tourism and hospitality.

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sanjay SudhirVV: Are there supporting policies or guidelines to encourage participation by Australian businesses?
SS: India’s ‘Act East’ policy seeks to establish closer ties and greater integration with the Asia Pacific region. But most importantly, the ‘Make in India’ program represents an attitudinal shift in how India relates to investors: not as a permit-issuing authority, but as a true business partner by streamlining the processes for investments in India. Dedicated teams have been created that will guide and assist first-time investors, from time of lodgement of application. There is also focussed targeting of companies across sectors.

VV: How does the NSW Government support this major initiative?
SS: The NSW Premier had a highly successful trip to India early this year, and apart from visiting two sister states of Gujarat and Maharashtra, he also participated in the ABWI. In its ‘India Strategy released immediately after the Premier’s visit last year, the NSW government has drawn out a very detailed plan of action, to support industry / exporters wanting to do business in India. As part of this action plan, the NSW Government will identify key sectors and opportunity to attract new investment from India, which will also include ICT and resources sectors. One of the key opportunities is Service exports in infrastructure, financial services and funds management.

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VV: How can the Indian community and trade organisations in NSW contribute to ‘Make in India’?
SS: It would be welcome if the initiatives were disseminated amongst the community, as well as with NSW businesses and industry on a one-to-one level. Perhaps some firm proposals can be brought to our notice.

VV: How will Small to Medium Enterprises (SMEs) from both India and Australia benefit?
SS: The focus of ‘Make in India’ is very much on the SME sector which include textiles and garments, leather and footwear, gems and jewellery, manufacturing and precision engineering units, and food processing industries. SMEs in India play a vital role in the growth of the Indian economy and contribute to about 45% of the industrial output, and similarly in exports.  They employ over 42 million and create around one million jobs every year.  I trust that SME sector in Australia is also important to its economic strength. I understand it is one of Australia’s largest employers.

VV: Discussions are ongoing on the Indo-Oz Free Trade Agreement (FTA), will this have any impact on the initiative?
SS: India and Australia have a strong and mutually beneficial partnership in the energy and minerals sector.  All of Australia’s primary exports to India are imported into the country at a very low tariff.  India and Australia are negotiating a Comprehensive Economic Cooperation Agreement (CECA) covering trade in goods, services, investment and related issues.  There have been seven rounds of negotiations; the last round took place in Canberra in April 2015. An FTA is expected to have a positive impact on ‘Make in India’.  It should see growth in business and industry seeking to benefit from preferential duties and a liberalised regime for services and investments.
Australia needs to increase its investments in India. Currently, Indian investments in Australia are more than Australian investments in India. From the two-way investment of US$ 16 billion, Indian investments in Australia are worth US$ 10 billion. I hope that with ‘Make in India’, there would be more interest among Australian investors to invest across the wide sectors in India.

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